How can facilities manage peak demand charges?

When I started working with SIS, one of the first things I learned about was peak demand pricing and the impact it has on a manufacturing facility’s utility bills.  These rates are levied differently by different utilities in disparate parts of the country, but the underlying methodology is still the same.  A peak demand period is retroactively determined every month and any power consumed during this window is billed at a much higher amount than the normal rate.  The critical component of this concept for facility managers is contained in that word retroactively.  At the time of the peak hour, neither the utility nor the facility has any idea it is going on.  Only after the data is reviewed at the end of the month can the peak time period be determined.

Obviously, the nature of this situation does not allow a manager to effectively prepare for the increased cost, and potentially adjust operations accordingly.  I recently read a series of articles on Facilitiesnet about the concept of demand response, and how managers are attempting to proactively prepare facility operations in anticipation of a demand response call from their local facility providers.

Organizations are not just looking at demand response as a way to contain costs, but also as a part of their larger sustainability plans.  Typically, that requires an organization to understand its load profiles.  “Loads occurring at peak times can be shifted, and soon facility managers can do this without considering demand response calls,” says Lindsay Audin, president of Energywiz, Inc.

In an effort to help facilities schedule these load shifting periods, SIS has developed the capability to notify managers days in advance of a potential peak event through the website coincidentPEAK.  Warnings can be issued as many as 10 days in advance, with confirmations provided 3 days prior to a potential peak demand episode.  An electric utility load management program typically provides little more than a 15 minute warning.

With advanced notification provided by SIS, a manufacturer can effectively plan a production schedule so that operations are not interrupted, and utility costs are significantly reduced at the same time.  A pilot program implemented with a foam insulation manufacturer has trimmed nearly $45,000 from that company’s electric bill in the past 4 months.  Imagine what an effective load management program can do for your company!

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